Types of Legal Entities in Pakistan.

Types of Legal Entities in Pakistan.

More and more foreign investors recognize Pakistan as a market to invest in. In March 2018, for example, foreign investment in Pakistan increased by USD 152.7. It is expected to grow by 17.2% by 2020.

If you are planning to invest in Pakistan, here are the types of legal entities that you can choose from.

#1 Private Limited Company

Foreign investors can set up fully foreign-owned private limited companies (LLCs) in Pakistan. The minimum number of shareholders needed in order to register this kind of company is two. Any foreign national can be a shareholder in this kind of company, except for those coming from Israel.

In general, PKR 100,000 (~US$ 823) is considered to be the minimum capital requirement. However, take note that the actual minimum capital you need to inject depends on your planned expenses.

Another requirement is that the registered address of the company’s office must be located in Pakistan.

The incorporation time of a limited liability company in Pakistan is generally six weeks. The registration is also subject to approval from the Board of Investment and you also need to obtain clearance from the Ministry of Interior.

#2 Single Member Company

Foreign investors, apart from Israeli nationals, can also set up a single member company in Pakistan with only one shareholder.

Just like a limited liability company, you can also set up a single member company in Pakistan with PKR 100,000 (~US$ 823) of minimum capital.

The standard time of incorporation is four weeks and also make sure that the registered address of the company will be in Pakistan.

#3 Public Limited Company

Generally speaking, a public limited company has their shares offered to the general public. Those shares are with limited liability.

Anyone can acquire the shares. It may be through a public offering or through trading in the stock market.

There are two types of public limited companies in Pakistan, unlisted and listed.

Allowed Foreign Ownership100%100%
Minimum CapitalPKR 200 million(~USD 1.6M)PKR 100,000(~USD 823)
Listed in Stock ExchangeYesShares must be subscribed by at least 500 applicantsNo
Minimum No. of Shareholders73
Time of Incorporation6 weeks6 weeks

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